Early and Late Demographic Transitions: the Role of Urbanization

This paper uses new estimates of the dates on which different countries have experienced their demographic transition to address two empirical questions. First, I study the importance of different socioeconomic variables on the timing of these transitions. Second, I distinguish between countries that have experienced early and late demographic transitions and compare their relative income around the transition date. My results indicate that the size of a country’s urban population plays a crucial role in triggering its demographic transition. In particular, after controlling for income and total population, more urbanized countries tend to experience an earlier demographic transition. Moreover, countries that experience an early demographic transition (before 1950) are much richer than latecomers, suggesting that urbanization plays a more important role than income in the latter. One interpretation of these results is that a country’s level of income and rate of urbanization are substitutable factors that trigger the country’s demographic transition. Finally, if one accepts the premise that urban agglomerations enhance both technological progress and the demand for human capital, the results provide indirect support for theories that highlight these factors as triggers of the demographic transition or the escape from Malthusian traps.